The value of a mutual fund share calculated once a day,based on the closing market price for each security in the fund´s portfolio. It is computed by deducting the fund´s liabilities from the total assets of the portfolio and dividing this amount by the number of shares outstanding.

The amount of cash and assets readily convertible into cash that a broker-dealer owns in excess of its liabilities. The SEC sets net capital requirements to ensure that broker-dealers have enough money to deal responsibly whit the investing public.

The difference between the closing price of a security on the trading day reported and the previous day´s closing price. In over-the-counter transactions, the term refers to the difference between the closing bids.

The largest stock exchange in the United States. It is a corporation, operated by a board of directors, and it is responsible for setting policy, supervising Exchange and member activities, listing securities, overseeing the transfer of members´ seats on the Exchange and judging whether an applicant is qualified to be a specialist.

A management company that does not meet the diversification requirements of the Investment Company Act of 1940. These companies are not restricted in the choice of securities or by the concentration of interest they have in those securities.

A security that must be purchased in a cash account, that must be paid for in full, and that may not be used as collateral for a loan. Examples include put and call options, rights, insurance contracts and new issues.

The potential for an unforeseen event to affect the value of a specific investment. Examples of such events include strikes, natural disasters, introductions of new product lines and attempted takeovers.